Less than two months remain in the popular EIDL Grant program. As a matter of law, the Targeted Economic Injury Disaster Loan Advance grant program will end on New Year’s Day.
Only $4B of the $30B original program has been claimed. It provides a $10,000 grant to businesses that sustained an economic loss during the pandemic. Qualifying, requires a business to have sustained a greater than 20% loss over an eight week period.
The additional Supplemental Targeted Advance, provides an additional $5,000 grant, or a total of $15,000. $1.8B of the original $5B remains in this one. In order to qualify, a business needs to have sustained a greater than 50% loss over an eight week period and be located in an economically disadvantaged area as defined by the SBA.
For further information and the application, please go to the following web address.
https://www.sba.gov/funding-programs/loans/covid-19-relief-options/eidl/targeted-eidl-advance-supplemental-targeted-advance
Let me leave you with this.
Earlier this week the October inflation numbers were announced, and it was bad, really bad. By now, you’ve probably heard the 6.2% overall inflation figure, but that doesn’t begin to explain the broader problem.
To understand it, one must look at the other indexes compiled by the individual branches of The Federal Reserve Bank.
The Cleveland Fed produces a “trimmed mean’ inflation indicator that eliminates the extreme higher and lower components, as well as a median level indicator. Both of those numbers just hit their highest point since October of 2008. which was the worst part of the last recession.
The Atlanta Fed produces numbers on flexible and “sticky” inflation. It measures the type of products that don’t increase or decrease quickly.
Economists watch this number because when it goes up, it’s very difficult to reverse. Last month recorded its largest increase since January of 1991.
The New York Fed produces a gauge that looks at the correlation between labor pricing and broader macro economic data. Generally the two numbers don’t diverge, but at present they’re both above 4%.
Three individual points need to be understood.
1 – This isn’t a blip. The overall and underlying numbers tell us that this is a long-term problem. How long it will last, no one can say, but we all need to settle in . This isn’t going away anytime soon.
2 – The pandemic no longer explains the problem. We’re much too far away from the shutdowns and stay-at-home orders for any of that to explain a rise in prices this significant and sustained.
3 – Wages are lagging significantly behind the price increases. This means that the average worker will be hurt the most. If you don’t want to start losing people, you’re going to need to at least give them a raise commensurate with the rate of inflation. Without that they will suffer and think about leaving.
You need to be watching your numbers like a hawk. This is the sort of thing that will affect all businesses. Don’t think for half a heartbeat that you’ll somehow be excluded.
A quick trip to your local grocery store should convince you of that fact.
Raising your prices is never easy, but given the sustained inflation now rampant in our economy, it becomes a necessity. If you don’t raise your prices, the person most adversely affected by this problem will be you.
When you have questions, please give me a call.
We’re all going to get through this. Let’s get through it together.
Accounting Solutions Ltd. stands ready to complete our mission and purpose of protecting you, your family, and your business. Whether you need Employee Retention Credits, PPP Loan Forgiveness, Payroll Services, or Accounting and Tax Work, you have but to ask. I’m here and I remain,
Sincerely yours,
Chris Amundson
President
Accounting Solutions Ltd.
773-267-7500
Note that the only professional services provided by Accounting Solutions Ltd. are those specified in a written communication from our office detailing the scope of services to be rendered and the terms and conditions applicable to the engagement.